IN A globalised world, it is increasingly a truism that no single financial centre can operate in isolation. The advance of technology means that trade and investment decisions cross borders and different markets in the blink of an eye – and the click of a button.
The City’s success as a financial centre has been in no small part due to our ability to rise to this challenge through connections all over the globe. As the world’s leading international hub, London has long maintained strong ties with New York – despite a healthy sense of competition – and other major European centres. In recent years, a select number of fast-growing financial centres have also increasingly turned to London and the lessons that it can provide to accelerate development.
The likes of Shanghai, Istanbul and Mumbai are all working alongside the City to leverage our experience and expertise when it comes to financing trade on the international – as opposed to simply domestic – stage. And next week we will be visiting Russia to help support Moscow’s ambitions to establish itself as an international financial centre.
There is no doubt that Russia is an established economic powerhouse on the world stage. But it is resource rich and services light, whereas Britain is the opposite. It makes absolute sense for us to work together.
Last October, President Vladimir Putin said: “We must admit that Russians do not yet have enough information about the role of the financial market and the opportunities it presents… Therefore, we are going to work on improving financial literacy, strengthening public confidence in the Russian financial sector and creating new tools, including those that provide protection from inflation.
Following the Prime Minister’s visit to Sochi last week, the City is the natural partner for Russia to achieve these goals. That is why I will be co-chairing the fourth meeting of the Moscow/London Joint Liaison Group alongside Alexander Voloshin, head of the Russian government’s taskforce, to discuss how City firms can help their Russian counterparts put natural resource wealth to work to drive growth and development across all sectors of the economy.
There are opportunities for UK companies in banking, insurance, pensions, legal services, capital markets, and accountancy. The City’s experience on issues including alternative dispute resolution, arbitration, and listings are all of particular interest to Moscow.
The political commitment to turn Russia into a major international player is reflected by the $1 trillion infrastructure upgrade programme driven in part by next year’s Winter Olympics and the Fifa World Cup in 2018.
At first glance, it might seem counterintuitive to help other centres grow as it will inevitably lead to greater competition for London. We believe, however, that the growth of the financial services industry globally will benefit us over the long-term by creating new business opportunities.
Roger Gifford is lord mayor of the City of London.